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the dow down thee days in a row. that hasn't happened since late july. down 129 points. that is the first hour of the "closing bell." stay tuned. we have an, exclusive interview with the ceo of international paper in just a moment. welcome to the clo"closing bell." hooer here's what we're following. stocks sinking, pushing the nasdaq and s&p lower for four days in a row, the dow three days in a row. is this a buying opportunity or is october going to get worse? plus, an interview you don't want to miss. you just heard bill talking about. also this one. this one is going to be so interesting. we're going to speak exclusively to this ceo threatening to close his company and fire thousands of employees if president obama wins re-election.
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>> that's essentially the tenor of an e-mail that david siegel of westgate resorts sent to his employees recently. in the meantime, here's a look at how we're finishing out. the dow off the lows, down 128 points today to 13,345. three down days in a row now. the nasdaq down 13. the s&p down 8. down four sessions in a row. all major averages are down for the month of october. fears over earnings and global growth weighed on the market once again. we're wondering if october will be as scary as some often predict. if past days are any indication of what lies ahead, should investors be concerned right now?
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are you nervous here? can we see more selloff? >> if you look back at last 70 years, we've had a 10% correction on average once a year. we had that from april until june. we get 5% corrections better than twice a year. we're probably in that. if -- >> i think the highs for the year are actually going to be made in october. clearly last week we saw really strong market right now. what gives me confidence is that, you know, a lot of hedge funds have underperformed, long-short equity funds, according to bank of america, low single digits for the year. we're just in this pre-earnings dance right now that everybody is really fearful of. >> you felt we would see the highs for the year this month. does that mean we've now seen the highs for the year? >> well, difficult to know with
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laser precision, but i do think we're going to make another run. it's interest we pulled almost precisely back to the 50-day moving average, which michelle had mentioned earlier we hadn't seen since the 23rd and 24th of july. >> todd morgan, what do you think at this point for the month of october? eni ening. >> long term we're very optimistic. the market has had a terrific run so far. last time i was on, we thought the market was very much undervalued. maybe now it's fairly valued. you can't always listen to what people say. you would have missed a terrific run in the stock market. we're looking for a pullback. we've built a fair amount of cash. we're optimistic long term. near term we are somewhat cautious. >> rick santelli, you're the veteran market watcher. what's the mood of this market?
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what's the message you're reading right now? >> the message i'm picking up from most traders is that the most hated rally in history is probably turning into the most widely anticipated correction. so i think i'm going to have to go with the panel, between source, and little anecdotal aspects i pay attention to. anniversary dates are big in technical analysis. we just had the anniversary yesterday in terms of the five-year mark. i think you're going to see many traders lay off the bike pedal, see how far down it goes. i think this is the post-bernanke hiccup. they've thrown everything but the kitchen sink. the disparity between the stock market and the reality of the economy is the spread is very wide. anticipation of the uncertainty. you know, we've been talking for weeks, months, the fiscal cliff. here's the correction. i'll go along with it. yes, i think market's going to work its way lower. >> dan, are you nervous that all four of you agree and are
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nervous? >> i'm not really that nervous. >> when we get 5% corrections, they're over and done with before we have a chance to act on it. if you get a 5, even 7% correction, you want to use that opportunity to buy stocks that may be down 8 to 9%, 10%, perhaps. >> what are you going to buy here, david? >> i'll give you a few names. on a smaller cap site, itt, which is a spinout. about a year ago they spun out their defense and water business. i think the management is very shareholder driven. the yield is compelling, and they're going to grow the yield. another name that looks compelling to me is the housing market continues to improve. lowe's, very shareholder driven. valuation at a discount to home depot. i think there's a couple ideas. >> itt as a small cap. harold jeanine is spinning in a grave somewhere. if you don't know who he is, look him up. >> i was going to ask dan the
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same question. what with would you do? >> i think ben bernanke is telling you you have to move out on the risk curve. two stocks we like, the gwr in the new york stock exchange. just fantastic long-term record. made what probably will be looked at as one of the most important strategic moves by buying rail america. very, very high-quality asset. the other company we like a lot is mtw, maker of trains and other industrial food service equipment. company just raised money in the high-yield bond market at 5 7/8 for a ten-year term. not so high yield, but very creative and puts them in really good standing from a balance sheet perspective. >> todd morgan, what are you going to buy? bearing in mind, it seems the appetite for treasuries is still very strong these days. would you buy treasuries as well? >> no, i would not. i'm a contrarian. i like to buy what nobody really likes. stocks are really out of vogue
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and someone said earlier this is the most hated rally we've seen in decades. i continue long term to focus on large cap multinational high-dividend paying kind of names. that's what we like. if you close your eyes and don't look at them for a year or two, i think you'll be very pleasantly surprised and get a much larger, more significant return than you will buying u.s. treasuries. >> gentlemen, thank you so much. >> thank you. >> buy 30-year bonds. >> okay. yeah, there's a treasury auction coming on those as well. so which stocks are being hit the hardest so far this month? >> just today the dow and s&p turned negative on the month. that's the quickest that's happened in a month since july of last year. it's brought a lot of stocks down into the red today with the
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market's overall spoiler. the most negativity is hitting health care and tech. let's look at the five worst october performers on the whole. the first is striker, down better than 6% in october to date starting the month with the management shake-up. orthopedics president took on the ceo role as well. investors seem to be waiting on the sideline there is. advanced microdevice is down just about 6.5%. pacific crest downgraded the company a week ago citing an inventory correction. next, auto desk down 7%. a couple small deals this month as well as some issues in the field. ubs says it's still a buy following a meeting with management and thinks that a share buyback will help. down nearly 7% on that name. also, zimmer down 7.4% in the first ten days of the month. the company disclosing october 1st that it received a warning letter. the weakness could be a buying
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opportunity in zmh. the biggest loser, guys, edwards life sciences. a big revenue miss earlier this week caused the stock to bounce. the fundamentals remain in question. down 18% in just the ten days of the month. bill and michelle, back to you. >> very good. thanks. see you later. >> we're going to talk about how to make money in this market if it does get even more scary next. >> do not touch that remote. we have much more ahead on this spooky wednesday edition of "closing bell." coming up, paperweight. the ceo of international paper explains why his company is increasing its dividend, but will it come at the expense of hiring more employees? plus, voting block? one ceo threat tons fire some of his staff if obama wins re-election. find out why just ahead on the "closing bell." i love you, james.
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on the best brand-name mattress sets. get your best rest ever from sleep train. ♪ your ticket to a better night's sleep ♪ more on today's selloff now. we pretty much read across the board, few notable exceptions though. with today's losses, we have the dow and s&p 500 joining the nasdaq in negative territory for the month of october. >> so is this the time to be a
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buyer, or are you safer on the sidelines? ron says there's still reasons to be a bull, while abigail is not so convinced. ron, make the case. you're a long-term bull. >> as i said over the last couple week, i also thought we might have anywhere from a 3 to 10% correction anywhere between october and the election. meanwhile, you have every central bank on the planet ru rushing liquidity into the system. whether it's the european central bank, the people's bank of china or the fed, there's a lot of liquidity still sloshing around. as it's always been said, you don't fight the fed. >> abigail, you say it's time to be bearish. >> i think ron makes a great point about this current slide in the markets. when we look at the dow transports, they've been trading in a more than year-long trend of lower highs. that's a bearish trend. the dow transports have been trying to take out a year to date low as the dow industrials
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have been trying to go higher. typically that's a bearish signal. this week of concern, nasdaq composite below its 50-day moving average. from a technical perspective, we're going to see the major indices go to their moving day average. that's the blip down ron was talking about. will that support hold? when i look at the crb index, a measure of the commodity complex, i'm not so sure. that index is very much reversing its qe-3 inspired up trend. this speaks that we could see something bigger. >> bob, we're going to play a sound bite from jamie dimon later saying they're preparing a war room for the fiscal cliff. i got to think that the ceo of a bank like jpmorgan saying they're preparing a war room can't be positive for the stock market. >> well, i think most traders are betting that somehow the fiscal cliff is going to get resolved. i don't think that's the major issue for the stock market right now. i think ron is absolutely right. short interest comes out every two weeks here. short interest is near multiyear lows right now.
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it's not because anybody's in love with the stock market. a lot of people hate it. shorting the market has been a disastrous strategy this year. >> bob, lets play that sound bite and see if you're still convinced. here it is. >> we have -- we're forming now a fiscal cliff war room, command center, and all that kind of stuff, going through to make sure we understand all of it. we'll be prepared. i mean, jpmorgan will survive a fiscal cliff. i just think it's terrible policy to allow it to get close. >> ron, when a major bank is preparing a war room for an event, it's not positive, right? >> well, let's put this in context. jpmorgan had a rather embarrassingly large trade earlier in the year that cost it money, that sent jamie dimon in front of congress. he's not going to make another mistake when it comes to risk management, if there's an obvious problem that could be out there. whether or not there's a little pr at work here, whether or not we're going over the fiscal cliff remains to be seen. it's the prudent thing for him
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to do. i agree with bob. i don't think we're going over. they're going to cut a deal. >> also, play it contrarian a little bit. a lot of companies probably set up war rooms for y2k as well. >> that's absolutely true. >> when we think about the debt ceiling crisis last year that was resolved at the very end, but then we had a 20% correction after the case. that uncertainty resolved to the downside. corporate insiders, their selling has increased. a recent index said five to one. that's pretty bearish. i think we need to see whether or not support can, in fact, hold. >> how much lowering you see the markets going, abigail? putting it in the context we've had a tremendous move in the markets overall since the lows back in 2009. how much of a correction could you see happening here if you're bearish? >> it depends on what levels are taken out. when looking at the s&p 500, it's a ways down. well below the 200-day moving average. if the s&p were somehow to breach 1200, which sounds
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absurd, but technically there is some case for it. i think you could actually see a triple-digit s&p, if you can believe it. i don't think that should be taken too seriously right now. it's more a matter of watching the closer moving averages. >> isn't this more buy on the dip than get me out of here? we're at 2.8% off of the 4 1/2-year highs of a few days ago. >> you're right. i would not personally be adding to a portfolio until we see that test of the two -- >> i'm going to push this issue one more time. the ceo of chicos, retailer, women's clothing, he says when we were in the middle of that drama about whether or not -- all that fear mongering, oh, the u.s. is going to default, he said sales drops dramatically because it destroyed confidence. if we go through another one of those se thecenarios, you don'tk it could be detrimental? >> certainly. we know that from 2010 and 2011.
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we had the european debt crisis in 2010. we had the european debt crisis plus the debt ceiling debacle in 2011. this year we corrected in may, 9.9% peak to trough and rallied. i don't want to jump out every window that's open. i recommended a couple weeks ago taking profits on double-digit gainers and standing on the sidelines for this correction. i don't think we're in danger of falling off the cliff, either cliff, just quite yet. >> all right. thank you, all. nice discussion. see you later. >> higher dividends. are they getting in the way of more jobs in america? >> get to do something with the cash, right? >> you have all this money. what do to you with it? we're going to speak with the head of international paper, the latest company to raise its dividend next. see if it's come at expense of hiring. you're not going to see this interview anywhere else, by the way. >> that's what we call an exclusive. plus, we're going to talk with the head of westgate resorts.
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he's threatening pink slips for all 7,000 of his employees if president obama wins re-election. you cannot make this stuff up. >> that's also an exclusive. >> also, former hewlett-packard ceo's reaction to that story. would she have ever sent her employees an e-mail like that one? >> then a little later, mortgage refis are booming. you think people would be spending extra savings on remodeling, lavish vacations. those days are done. our housing guru on where the money's going instead, and it's not necessarily helping the economy. >> also, you will not believe what got someone arrested at lax, los angeles international airport. the outrageous story is making everyone nervous, coming up.
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in case you hadn't heard, international paper announced a 14% dividend increase. that's 30 cents a share. the company's stock up 45% in the past year. it's been a stellar gainer among the blue chips out there. n >> and you're getting revenue at the same time. ip joining a list of companies opting to boost the dividend. the ceo joins us now for an exclusive interview. great to have you here. >> glad to be with you. >> when a company has cash, they can raise the dividend, they can hire more, they can buy back shares. why did you choose to raise the dividend among all your choices?
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>> international paper is a cash flow story. we didn't raise the dividend at the exclusion of doing other things. in fact, we just recently invested $100 million to invest in a factory here in virginia. we're exporting 100% of the products. we're doing a lot of things. we're cleaning up our balance sheet after an acquisition. we've committed to a balance of cash flow. >> we were just talking to an analyst here. we were going to ask you, are you -- is your strength -- i mean, the stock price has been on fire this year. is that a result of your business here in the u.s. or internationally? >> well, international paper has completed a transformation plan. we really repositioned the business, all of our businesses, and are well positioned. we're quite confident of our free cash flow. even with a tough global environment -- there's no question it's tough. >> i mean, you are taking
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advantage of this, not a revival, but this emergence of the asian consumer. you're finding markets there that are meeting your needs very quickly, aren't you? >> sure. we have a business in asia. we've got a business in russia that exports to china. we have a business in india, brazil. we've got positions in our core businesses paper and packaging in the emerging markets. our biggest market is still here in north america. >> speak of north america, how concerned are you about fiscal cliff and what it might do to consumer demand here or business demand for your products? >> well, i think i'm a realistic optimist. i don't think we'll hit the fiscal cliff. i don't think that was intended by the members of congress. we're kind of going to probably deal with this at the 11th hour and the 59th minute. i think we'll manage through it because everybody, i think, in congress knows that wouldn't be a good thing for the economy. that's what's most important right now. >> jamie dimon of jpmorgan today revealed that they've set up a war room to monitor the fiscal cliff and to set up strategies
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just in case. are you? >> well, we lived through 2008 and '09. actually came through it as a stronger company. we watch what our customers are doing. we're in the business of making products to sell to customers who in turn sell them to consumers. we're in the packaging and paper business. we're watching our customers' orders very carefully. basically, the economy feels like it's going sideways here. >> do you think there's an impact on your company based on the outcome of the election, whether it comes as an impact to your health care costs or whether or not you see your share prices move because of the impact on dividends? >> i think governor romney would be better for the economy. so i don't think -- near term, there's not much either president is going to do. >> why would he be better? >> pardon me? >> why would he be better, do you think? >> well, i think we've had four years of very sluggish economic growth. i think governor romney understands the economy. he's been in the business world.
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i think he would be a big boost of confidence. >> let me pursue what you said earlier about the economy. you see it going sideways. is that globally? is that just the united states? is it internationally? bear in mind, last night we heard from alcoa and klaus kleinfeld seeing a decline in demand for aluminum internationally. what about what you're seeing right now economically? >> we're seeing north america, the united states basically flat. that feels sideways. europe is down a bit, but our business in europe is heavily tilted to eastern europe and includes russia. our business is actually up in russia and eastern europe. brazil feels like the united states. china, i think china is growing at something far less than 7%. they've slowed down, and it feels more to us like 2 or 3%. >> really? >> wow. that's a real deceleration. still growing, but at a much slower pace. >> well, that's what it feels like to us in the business we're in. we're about half selling to
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customers who export their products and half to customers that sell domestically. if you look at things like electric power con sumts in china, it's flat. that ought to be a good indicator of the level of economic activity. i do think it will come back though. >> that's what we call burying the lead. you got our attention with that number right there. >> right. absolutely. >> thanks for joining us today. appreciate it. >> thank you. >> the ceo of international paper joining us. 2% growth in china? >> and lot of people don't believe the gdp numbers they put out officially. >> 8% on the low end to 2%. that's a big number. >> a 6% difference, which feels recessionary. even though you're still growing. >> yeah, yeah. >> all right. imagine getting an e-mail from your company's ceo saying your job could be at risk if president obama wins the election. this is really happening. we're going to talk to the ceo who's saying it and get the former hewlett-packard ceo carr
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let fiorina to weigh in as well. remember when your mortgage was like withdrawi ining money an atm? that was then, this is now. we have a harsh reality check coming up in a moment. also, is your bank in trouble? a new study shows one in eight banks is at risk. we're going to talk to the head of that study.
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if president obama wins re-election next month, employees at one particular company may be looking for new jobs. our wealth editor robert frank explains why. >> withis is the e-mail that's exploded on the internet today. it's written by david siegel, the ceo of westgate resorts. he said if obama wins, they could all lose their jobs, quote, if any new taxes are levied on me or my company, as our current president plans, i will have no choice but to downside. you can find me in the caribbean sitting on a beach with no employees to worry about. what makes this e-mail so provocative is its author, david siegel. he's the man best known for building the largest home in america. he and his wife jackie built a
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90,000-square palace just outside of orlando. he said it's about his workers. they would be the big losers if obama gets another four years. he told me he wasn't threatening his workers or even telling them how to vote, just to educate them before they pull that lever in 27 days. bill. >> robert, thank you. >> don't move, robert. we're going to bring in the ceo who actually wrote the letter. westgate resorts david siegel joins us now on the phone. also joining us is carly fior a fiorina, who sat at the top of hewlett-packard. we're going to get her reaction in a minute. first to you, mr. siegel. what has been the reaction inside your company from your employees? >> mostly positive. maybe the people that are negative haven't reacted, but the reaction that i've gotten so far has been very positive. i was coming to work today and actually had an employee stop in the parking lot, get out of
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their car, and come over and say we're behind you and believe in what you're doing. so not only is the reaction from my employees, but i've gotten hundreds of e-mails, 90% positive. i've had phone calls from around the country, people all very positive. it wasn't my intention when i sent the private memo to my employees for it to get outside of the company, but someone apparently sent it to the media. next thing i know it's gone viral. >> so maybe somebody's going to lose their job anyway. anyway, bearing in mind, mr. siegel, that it is congress that sets tax policy in this country, do you really expect tax structure in this country change should governor romney win the election? >> i'm only listening to what president obama is saying, and that is raise the taxes on the wealthy. that's me and the other small
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business owners around the country. >> and that upsets you so much that you literally say i'm going to go sit on a beach, shut down the whole thing? connect those dots for me. taxes go up, and so -- >> you're taking things out of context. >> okay. >> you know, this is not speculation. i have lived the last four years under the obama administration, and i've watched my company be cut in half. today we're very profitable, and i don't want to go through another four years under the obama administration where i have to downsize again. >> you cut the company in half as a result of tax policy? is that what happened? >> no, it had nothing to do with tax policy. it had to do with the tightening of the banks. tightening of money. when they gave t.a.r.p. money to the banks, they should have told
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them to loan it out. instead, the banks kept the money, bought back their own bonds and stock. they made their own balance sheets very good. they didn't spread the money around to businesses that were starving for financing. as a result, we had to cut our company in half. we had to lay off 7,000 employees and be very lean and mean to survive. well, it was a very unpleasant experience, and i don't feel like going through it again, but this was before obamacare, before increasing my taxes. i can see the future. >> it sounds like you're dealing with the results of a country that was overleveraged. there's a lot of things to criticize president obama for. i think a lot of people would agree. in the end, leverage was dramatically high. it was going to come down. you really blame him for the fact that leverage had to
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contract in this country from astronomical levels? >> no, what i'm blaming him for is not doing something about the economy in the last four years, and i feel that we're on a downward spiral and the next four years under the same do-nothing administration is going to be even worse. i'm just informing my employees that an obama administration -- there's a good possibility we'll have to downsize again and that their futures might be jeopardize. >> okay. robert, you got a question? >> one of the reasons this e-mail has hit such a nerve is because people know you as the guy who built the largest home in america. you know, they know you for better or for worse as the guy with one of the biggest lifestyles that's been on the big screen recently. they have a hard time understanding how you could complain about your situation, your company's situation, or the
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effect on your employees when you're doing quite well right now. you mentioned your company's very profitable. you've paid off all your big debts. how do you answer those folks who raise that question? >> i am not worrying about myself. i'm worrying about my employees and their future. when the company was in need of money, i stopped construction on the house. i put all the money into the company. i work 24/7 running this company, and the last four years have not been very pleasant. if i have another four years like the last one, i will seriously think about retiring, and that would further downsize the company. >> carly, what do you think of this situation? last time you and i spoke on this program, you did admit there are a lot of things to worry as about a ceo of a company. the fiscal cliff just being one of them. global slowdown as well. in this case, though, by sending an e-mail like this to
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employees, in your view, is this fear mongering on the part of a ceo, or is it a realistic attempt to just set them up to understand what could come depending on the outcome of the election? >> first of all, let's remember that mr. siegel is the founder of this company. it is he who took the risk to form this company. it is he who has taken the risks to keep this private company going. so i think he is in a very different position than i was, for example, as a hired hand, if you will, of a public company. secondly, i think we can quarrel with his use of words, perhaps, but my guess is his employees know him pretty well. he obviously has every right to express his opinion. third, i think he's raising a serious point. you know, he may have done it in a more colorful way, but there is a reason that the national federation of independent businesses says that small
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business owners' confidence continues to deteriorate. that's because small business owners look to the future and say, i don't know how i'm going to don't manage successfully if i have to deal with more taxes and more regulation and potentially continued tightening of money. i think he's raising good issues. now, you know, the last thing i guess i would say is i'm really troubled when we conflate the size of someone's house with their ability to express their opinion. i think the size of his house has nothing to do with this. whether we like all his words or not, he expressed a point of view to his employees. >> we should point out, carly, you are a romney supporter. what about the fact that the spirit of his complaint is actually about his inability to access credit? do you think a future president romney could somehow magically change a deleveraging society? >> well, look, i publicly, on
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your network and others, said when t.a.r.p. was officially put forward by the bush administration, to your point, that it was fundamentally flawed because it didn't force the banks to actually lend money. what it did was encourage banks to use that money to strengthen their own balance sheets. i totally accept your point that the tightening of credit, particularly to small and medium-size businesses, is part of the failure of t.a.r.p. and that's a bipartisan affliction, if you will. it's not simply the obama administration. nevertheless, i think it's undeniable that the obama administration has been crystal clear that they plan to raise taxes on the wealthy, that they plan to raise taxes therefore on a lot of small business owners, and that they plan to continue to increase the amount of regulation out there. those are just facts. those facts hurt small businesses. >> mr. siegel, now that we've
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had this very public discussion and the world knows what you wrote in that e-mail, do you regret writing it at all? >> no, i wanted to inform my employees of what their future would hold if they make the wrong decision when they vote. i wasn't threatening any of the employees. if they vote for obama, they're not going to lose their job, but but they have the potential in the future if this economy continues to spiral downward in taxes and obamacare coming into effect. they do have the possibility that the company will be further downsized. every company wants to grow, wants to increase the benefits they give their employees, want to hire more people. i see the future exactly the opposite of that if we don't change administration. >> mr. siegel, appreciate your time.
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thanks for joining us today. appreciate it. carly, always good to see you. see you soon, i'm sure. >> see you later. >> robert, thanks. >> i haven't seen this documentary about him. >> about the house building and all that? yeah. up next, a new study shows banks in weak states that failed just a few years ago could become unhinged again. >> find out if your state is at risk. stick around. ♪
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been bad this week, what if we have to start worrying about the health of our banks again? just when you thought it might be safe to go back in the water a report today says one in eight u.s. banks have famed a new stress test. not the one by the federal government, but one stress test nonetheless. among other findings here, the failing banks would have to raise an additional $25 billion in capital to achieve a passing grade. >> joining us now with exclusive details is matthew anderson. he's part of the company that conducted the study. how do you come up with this? what methodology did you use? >> i'm glad you outlined that our stress test is just that, it's our application of an economic scenario, a downside economic scenario to bank earnings and bank capital. so what we did is we took the sort of variables that the federal reserve was forecasting in their c-card stress testing
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of the largest banks and applied that same sort of scenario to the entire universe of banks. >> are you tougher than the feds? >> we're probably tougher in some areas. we don't have all the data at our fingertips that they have, so they have a bit of an information edge. but i think we're pretty harsh. >> now, the banks that you identified, are they small banks, are they banks that everybody knows, are they any of the big banks that everybody is very familiar with and deeply invested in? >> we tested the entire universe. we're not publicizing names of individual banks, but just to segment the results a bit, banks over $10 billion in assets, which would technically be mid-sized or larger banks, did better in our results. only about 5% of those banks fell below the thresholds. measure -- more like 13% of the smaller banks. >> any of the too big to fail?
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>> i can't comment directly on that. one comment i could make about the largest banks is they've done a lot of capital raising over the last four years. they've raised 90% of the bank capital that's been raised out there. so they're in a much healthier position than they were three or four years ago. >> so what's the take away here? are we in better shape than we were -- certainly we're in b better shape than at the height of the financial crisis, but are we making progress in fixing the bank problems, or are we sliding back again? >> that's a great point. i wouldn't say we're sliding back. we're definitely making progress. the big plus is that, you know, we're through the worst of the credit cycle. the downside is we're not all the way through it. there's certainly some pressures on bank earnings like the low interest rate environment and anemic loan growth are definitely impacting income for all the banks, big and small. >> is that anemic loan demand, or are they still reluctant to
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loan, as we saw, as we merged from the financial crisis? >> yeah, in our view, it's really a bit of both supply and demand. no doubt the demand for loans is pretty weak out there. at the same time, credit standards are a lot -- underwriting standards are a lot higher than they were at the outset of the credit crisis. >> i'm going to ask you a question i'm sure you didn't expect. we just had on this ceo that wrote this letter telling his employees that if president obama wins it's bad for the company. he was complaining -- it's a real estate company -- that his issue with president obama is that they didn't force the banks to lend when they got that new capital. is that a justified criticism? could any president have achieved that, or should they have achieved that when they needed to rebuild their balance sheets? >> well, no, i don't think you can force banks to lend. there was a mention of t.a.r.p. and that it could have been applied better. no doubt it could have worked better, but if you remember, the
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global financial system was melting down and t.a.r.p. did a lot to prevent that utter meltdown. so i wouldn't say that t.a.r.p. was a total waste, but it certainly could have done better in terms of spurring loan growth. >> and very quickly, you highlighted the fact these low rates we're in the midst of right now are not great for their business, yet the fed has telegraphed it's going to be like this for the next few years. do you sense based on these tests you're conducting that things will get better from here, or are we plateauing at a low level? >> from an interest income and interest rate standpoint, i think at best we're looking at a plateau. that explains why banks are looking for everywhere else to find income. so what we call noninterest income, things like -- >> fees. >> exactly, fees. you got it. >> it's that four-letter word that's only three letters. >> the "f" word? >> the other "f" word.
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>> my mom's going to be mad at me for that one. >> with refi rates so low, you would think money would be flooding into cash registers at home improvement stores, right? our housing money would be flow cash registers at home improvement stores. someone thought it would be okay to travel with all of this in his luggage on his way to boston. we're going to tell you what happened next. ♪
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which isn't rocket science. it's just common sense. from td ameritrade.
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extremely low mortgage rates fuelling a refinance boom. diana has the details in today's realty check. >> i'm going to use the r word a lot. one quarter of all u.s. mortgages will be refied this year, some more than once. what does that mean in cash savings? freddie mac ran exclusive numbers and puts it at 7.1 billion just through june.
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according to freddie 81% kept the same amount or lowered. so where is the money going? we asked mortgage lenders from east to west and got nearly identical answers. a lot of borrowers are putting the extra cash directly into savings plans and others are paying down their loans. many are using the lower rates to reduce the term in the loan paying off the principal faster. and julian in california said refito a lower payment but keep making the previous payment in order to pay down the loan faster. some are doing home improvements but not at the rate we saw during the housing boom when cash out was king. that is bad news for home remodeling companies and home
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decorators. yesterday owens corning cut its full year forecast. this is the point where i would tell you to check out more details. do that but also go to my new facebook page for this information and everything you ever wanted to know about real estate. >> we like it already. >> if you can't beat them join it. like it. >> we're friends. don't worry. wait until you hear what this guy tried to sneak through airport security. >> and then we see all the items -- [ horn honks ]
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hey, it's sandra -- from accounting. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today. i mean i know that this is important. well, both are important. let's be clear. they are but this is important too. [ man ] the receivables.
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[ male announcer ] michelin knows it's better for xerox to help manage their finance processing. so they can focus on keeping the world moving. with xerox, you're ready for real business. one of the craziest stories out of the airline business. a man was arrested at lax after officers got suspicious about his outfit. he was wearing a bullet proof vest and flame resistant pants and had weapons, a smoke grenade and a gas mask. this man is not thought to be linked to a terrorist group. how did he get on the plane in
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japan to begin with to get to los angeles? >> it's amazing. they say they don't think he is associated with terrorists but they don't know what he was doing with it. >> i don't know if you are wearing flame resistant pants but what is going on here? >> you would be amazed at what the tsa finds. every day they find five to six guns at airports around the united states. take a look at some of the whackier things that the tsa has reported in the last couple of months. you have a knife on a walker, a spear gun in a carry on bag. that is a knife in a lip stick container. somebody brought an 11 inch machete. >> this is when tsa gets combat pay for something like that. >> thank you. you should stay tuned for the next show because spain has been downgraded by s&p.

Closing Bell With Maria Bartiromo
CNBC October 10, 2012 4:00pm-5:00pm EDT

News/Business. Maria Bartiromo. Analysis of the day's winners and losers in the stock market. New.

TOPIC FREQUENCY Us 8, S&p 8, Obama 7, China 6, Mr. Siegel 5, U.s. 5, America 5, David Siegel 4, Romney 4, North America 3, Bob 3, United States 3, Obama Administration 3, Carly 3, Westgate 3, Russia 3, Jamie Dimon 3, Itt 2, Jpmorgan 2, Abigail 2
Network CNBC
Duration 01:00:00
Scanned in San Francisco, CA, USA
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Tuner Virtual Ch. 58 (CNBC)
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 528
Pixel height 480
Sponsor Internet Archive
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on 10/10/2012